This is the final installment in this little mini-series on how I’m approaching my finances in 2013. It’s a big area of my do the work theme and I’m sick and tired of feeling overwhelmed about my finances and out of control.
My money goals for this year are the following (also found on my resolutions page):
- Put myself on a strict budget and evaluate how I’m doing on a monthly basis. I plan on doing this in great detail the first weekend of every month, but also keeping a log in Google Docs with where my money is going and keeping up-to-date on that. Typically, I can go weeks without looking at my bank account, terrified to see what my balance is. That’s not helping me at all. I also have a budget template I use that breaks down where my money needs to go (i.e., bills, savings, extras, etc.) and I want to take one morning every two weeks (preferably the day I get paid) to get all the bills taken care of.
- Save at least $83 per month to have $1,000 saved by the end of the year. I’m terrible at saving so this is an area I want to work on in 2013. Having $1,000 in savings would just make me feel so much better if anything unexpected pops up. I know it’s really not enough, but it’s a start. In doing so, I have a goal of saving $83 per month which is doable for me right now.
- Pay off my last credit card. This one is being taken care of tomorrow! It has been YEARS since I have had no credit card debt on my conscience so it is going to feel amazing to have this goal done with. By paying this off (and not using it unnecessarily), this gets yet another bill off my plate which is necessary for my future budget.
- Set up a payment plan with the collection agency holding my ER bill. One of my major money goals this year is to get my ER bill completely taken care of. I’m not sure if I can get it all paid off this year, but I definitely want to make major strides with this because it’s been weighing on me for a while now.
- Spend less than $100 on Kindle books. My Kindle habit is out of control and between free book deals I’ve snatched up and a Kindle gift card I have in my possession, I don’t see myself spending any money for a few months at least.
- Buy a car. This is my biggest money goal for 2013. I’ve put this off because of money issues, but it’s apparent I really need to possess my own car, if only to give me more of a feeling of independence in my life. I don’t live in an area with a good public transit system and relying on other people is getting old. I am hoping for a decent tax return so I can put a good amount down and not have too high a car payment. I CAN’T WAIT TO DO THIS, YOU HAVE NO IDEA!
There are some money habits I want to begin this year, too. These will help me with my bigger money resolutions, and I think they’ll help give me more control over my spending.
- A cash budget system. I heard about this idea years ago and have always wanted to utilize this in my own life, but I just never had the motivation to do so. Getting money out of my bank is a pain and requires more steps than simply paying by debit card, but I know it’ll help me keep a handle on my money. My plan is to decide on a certain amount to take out of my bank account every other Friday and use that money for any extra expenses: food, entertainment, shopping, etc. I can use it however I like but once that money is gone, I’m done. If I use it all up in a week, well, I’m out of luck until my next payday.
- Gift cards. Amy originally brought this idea to my attention. Basically, the idea behind this is loading up gift cards with certain amounts to give me a limit I can easily see. Once I use up the gift card, then I’m done. I really, really love this idea and I’m thinking of implementing it. I’m still brainstorming ways I can use this effectively in my life but right now, I’m thinking of setting aside a “gift card envelope”. Any extra cash I didn’t use on my cash budget system during the two weeks goes into the envelope. Whenever I have enough cash to buy a gift card, I can get whatever I want! A Kindle gift card, a Starbucks gift card, an Old Navy gift card (my weakness when it comes to clothes shopping is Old Navy). Or perhaps setting aside $1 every time I work out or hit my healthy goals for the day. I’m still figuring out how best to make this work so any advice is helpful!
- Opening up a new savings account. Currently, I have a savings account with my bank, which requires just a $1.00 minimum, but has no real advantages. It’s also very easy to transfer money out when I need it. I’m trying to decide whether to keep my savings in this account or move it to something that reaps better rewards. (And makes it harder to access!)
- Budget, budget, budget. I adapted a fun little spreadsheet from Jenny Blake of Life After College and since I get paid every other Thursday, my goal is to spend Thursday mornings going through my budget, paying bills with an online payroll portal, and putting money in savings. I want to keep a running log of how I’m spending my money because last year I could go weeks without even opening my bank account. I didn’t have a good grasp on my finances at all. This will also help in my monthly tracking.
Finances are an area of my life I know I can gain control over with a few easy steps. It’s not going to take a complete overhaul of my life like losing weight will. All it’s going to take is a tighter budget and less unnecessary spending. It’ll take me a while to get used to not spending as much (I’m already counting down the days until February and I can have Starbucks again!) but it’s completely doable and I’m interested to see how it will affect my overall life.
Do you have any money goals for this year?
Dude this is awesome – these are all so realistic and smart! Ben and I use the cash budget for groceries and it really helps for me to physically see and hold the money to know the amount we have to spend.
Congrats on paying off a credit card!!!
Congrats (in advance) for paying off your credit cards! That’s awesome. I really love the gift card idea. It’s kind of like the cash budget thing but easier, and for fun extra stuff. A good reward for healthy habits too.
David and I are also focusing on finances this year. It’s hard at the beginning because we were so behind from the end of last year, and now even though we are not spending ANYTHING extra we are still struggling to catch up. But we’ll get there!
The gift card idea is a neat one! Lately if we want to go grab a bite out we look at where we have some coupons, gift cards or earn points and go there (we eat out maybe once a week?) and that’s helping us. I love to cook but I get burned out on it after six or seven nights in a row!
We are working on saving more and spending less and what we do spend, we are trying spend smarter (sales, rebates, coupons, etc.) but without overbuying (as in, I don’t have the desire to be a coupon-er).
Cooking has by far been my favorite way of saving money. I have fed Alan and me lobster meals for less than 15 dollars for the both of us!
I really hate cooking, but it seems inevitable if I want to save money this year. I foresee lots of Crockpot meals in my future!
Oh and money goals are a little fantastical this year.
– Save 1K for parents.
– Save 2K in Roth.
– Fund Paris
– Fund #WDS2013
– fund one more state
– somehow earn 3k outside of current job. (this is a doozy too)
The gift card method is interesting! Have you heard of the envelope budgeting method? Goes with cash only – you allocate your categories by putting money into an envelope for each different purpose (gas, groceries) and once that envelope is empty, it’s empty.
I have heard of the envelope budgeting method and I’m doing a slight variation on it with cash budgeting. Just basically taking a specific amount of cash out every other week and I can use that for whatever I like (mainly food and shopping).
I started using gift cards for my coffee fix, both at Dunkin Donuts and Starbucks. It has been pretty helpful, but sometimes I still go there even after the card runs out. I think I need to reevaluate just how much coffee I drink weekly at work, and maybe ONLY use it for work – I tend to load it, use it for work and at other times, then it dries up and I justify reloading it because I “need” it for work.
Yay for no more credit card debt! I reaaaaaaaally need to do better with that, but everything I bring it down, I feel this ridiculous urge to spend and/or book a trip LOL.
I also really love that gift card idea. I bought myself a gift card for Forever 21 in the summer and still have it, waiting for a good time to spend it. It’s like a gift from past you to future you! lol
I highly recommend setting up an INGdirect savings account. I think the name of that company is actually changing as they were acquired by someone (can’t remember who) but the interest rate they pay on savings is higher and it takes 3-4 days to get the money transferred back to your account when you want to withdraw it, which prevents you from making impulse decisions! I have a certain amount go to that account each pay day and try to up that by $50 each year.
Here are my goals:
– When I (hopefully) get a raise, I am going to set up my direct deposit so I get the same amount in my checking account and the rest goes to my ING account. I feel like we spend what we make, so if I keep getting the same amount in my checking account, hopefully I won’t spend more and will accumulate more savings!
– Pay off one of my student loans in the first quarter.
– Go the first 3 months without buying any clothes. This is tough for me as I get these great coupons from BR (like 50% off 3 items today!). Oy vey.
I knew you would help me out with the savings account thing! I will definitely look into it as I think it would be the better option for me than using my bank. Thanks!
Girl, I know how excited you are to buy a car because I’m excited to buy one, too! Buying a car is one of my financial goals this year, as well as opening up an IRA. Oh man, when did we become adults?
Just FYI, we’ve been struggling with keeping our budget for over a year, and this was the very first month we were able to stay under! You should check out Learnvest.com. It has seriously been a game-changer for us!
This list is a very good list and I think that you have set yourself some great but realistic goals for this project. One thing that really always works for me is having two things: rules and rewards. For rules, I try to find out my weak spot. Is it eating out, coffee, Target? Whatever it is, I try to eliminate 40 or 50% of it, for instance, only eating out once or twice a week instead of 4 times. But. Without reward, there is no incentive (because sometimes saving money is not enough). So I really like your idea of using the left over cash to buy a gift card. If you have a little reward for doing a good job, I think you will go far. For me, if I make my lunch 4 days out of 5 and only have one coffee out a week, I treat myself to brunch on weekend. I am still saving money and I feel like it is worth eating salads and sandwiches all week in order to get my french toast weekend!